Unpaid debts: How much the government owes South African businesses

Leon Schreiber in the shadow finance minister for the DA. He has collated several responses from this week in Parliament, and pieced together a puzzle of horrifying economic consequences. He concludes that the total of all unpaid invoices across our legislatures amounts to more than R7 billion:

“The South African state is facing a collapse, measured by its inability to pay service providers, manage appointments, carry out disciplinary action, combat wasteful expenditure and prevent corruption. The ANC is crippling South African businesses through its failure to pay for services on time.”

“The ANC’s mismanagement of the public service is directly undermining any hope of our economy recovering from recession. Combined, national and provincial government departments currently owe South African businesses – the engine of economic growth – over R7.1 billion in unpaid invoices older than 30 days.”

Leon Schreiber

Who owes the most money to businesses?

We also have a worst offenders list, where the biggest drain is – ironically – the water department. Surprisingly, the national government makes up just 9% of the total. Our provinces are behaving badly:

The Department of Water and Sanitation rack-up the highest debts, owing R492 million to business partners.

Agriculture (R99 million) and Police (R24 million) take second and third position respectively

In total, national government still has outstanding bills of R634 million. But our nine provincial governments owe a staggering R6.5 billion.

Look no further than Gauteng for the worst of the bunch, owning R2.6 billion in unpaid invoices. The Eastern Cape still has R2.1 billion to pay.

Government “don’t dwell” when it comes to paying their own

Yet it seems that business gets done much more swiftly when the government get to deal with “some of their own”: It’s estimated that 2 704 state employees conducted business with national and provincial departments between 1 April 2017 and 31 January 2018 – something which is highly illegal.

These questionable agreements have managed to top the R8 billion mark. So if our elected representatives showed the same gusto towards business payments as they did towards keeping their cadres happy, one would expect the outstanding debt figures to be significantly lower.